TD Ameritrade profit dips 2 pct but beats forecast

OMAHA, Neb. — Online brokerage TD Ameritrade’s net income slipped 2 percent as trading slowed, but the company beat Wall Street expectations because expenses were down and investors entrusted the firm with more money.

Ameritrade CEO Fred Tomczyk said Tuesday that the company believes its strategy is helping it weather the challenging conditions.

“Our balance sheet is strong, and we remain well positioned to deal with today’s uncertain macroeconomic environment,” Tomczyk said.

Ameritrade generates revenue from commissions it charges investors on trades and from asset-based fees and interest it gets on the assets it holds.

The Omaha-based company said that its net income fell to $153.8 million, or 28 cents per share, during its fiscal third quarter that ended June 30. That’s down from $157.4 million, or 27 cents per share, a year ago.

On average, the analysts FactSet polled were expecting earnings of 26 cents per share

Ameritrade says its revenue declined nearly 3 percent to $667.3 million from $684.8 million last year. Analysts expected revenue of $659.8 million.

Ameritrade’s profit per share was up because it had 23,741 fewer shares outstanding this year.

The average number of trades Ameritrade handled each day declined to 355,449 this year as investors continued to worry about Europe’s debt problems and the overall health of the economy. A year ago, Ameritrade handled 369,716 trades per day on average during the quarter.

The slower trading activity reduced trading revenue 5.5 percent to $266.1 million from $281.6 million.

The current record-low interest rates limit how much Ameritrade can earn on its clients’ deposit accounts and other investment products.

Ameritrade reported net new client assets grew 9 percent to $9.7 billion, and at the end of the quarter it held $445 billion in total client assets. A year ago, it held $413.7 billion in client assets.

So Ameritrade’s asset-based revenue grew 2 percent to $378.7 million from $372.0 million.